Crypto Basis for begginers

Centralized vs. Decentralized Exchanges

• Centralized Exchanges (CEX) act as intermediaries where users deposit funds and trade within a controlled environment. Examples: Binance, Coinbase.

• Decentralized Exchanges (DEX) allow peer-to-peer trading via smart contracts, removing the need for intermediaries. Examples: Uniswap, Curve.

Common Crypto Terms

• Blockchain: A decentralized, immutable ledger that records all transactions.

• Token: A unit of value issued on a blockchain, which can represent anything from a currency to a digital asset.

• Smart Contract: A self-executing contract with rules directly written into code, running autonomously on-chain.

Ethereum Token Standards

• ERC-20: Standard for fungible tokens — interchangeable units like stablecoins or governance tokens.

• ERC-721: Standard for non-fungible tokens (NFTs), each with unique attributes.

• ERC-1155: A multi-token standard allowing both fungible and non-fungible tokens in one smart contract.

Gas Fees on Ethereum

Every action on Ethereum (sending tokens, interacting with contracts, etc.) requires a fee — called gas — paid in ETH. Gas costs fluctuate depending on network demand and computation complexity.

How to Use Block Explorers

Block explorers like Etherscan allow you to search and verify transactions, wallet activity, smart contracts, token holdings, and more — offering full transparency of on-chain data.

Liquidity Pools & Governance Points (GP)

• Liquidity Pools: Token reserves provided by users on DEXs to enable trading. Users earn a share of trading fees in return.

• Governance Points: Points earned through activity in protocols, giving users voting power on future changes or rewards.

NFTs – Non-Fungible Tokens

NFTs are unique digital items on-chain — they can represent art, collectibles, access passes, or even gaming assets. No two NFTs are the same, and their ownership is verifiable on blockchain.

Stablecoins

Cryptocurrencies pegged to stable assets like the US Dollar (e.g., USDC, DAI), designed to maintain a 1:1 value and reduce price volatility — often used for saving, trading, or earning yield.

What is an Airdrop?

Airdrops are free distributions of tokens to wallets, often to reward early adopters, drive community engagement, or distribute governance rights. They’re like loyalty bonuses — but decentralized.

Bridging Between Blockchains

Bridging allows assets to move from one blockchain to another. For example, transferring ETH from Ethereum to Avalanche via a bridge creates a wrapped token version usable on the destination chain.

Memecoins

Memecoins are fun, community-driven tokens often inspired by internet culture (e.g., Dogecoin, PEPE). While they can go viral, they’re highly volatile and typically speculative.

What Are Swaps?

Swaps are instant token-to-token exchanges done via DEXs — no fiat needed, no central control. For example: swapping ETH to USDC directly on-chain using a smart contract.

Yield-Bearing Assets

These are tokens or protocols that generate passive income, either via staking, lending, or yield farming. Holding them can earn you rewards, fees, or new tokens.

Wrapped Tokens

Wrapped tokens are representations of assets from another chain (e.g., WBTC = Bitcoin on Ethereum). They allow interoperability — enabling Bitcoin holders to use Ethereum-based DeFi protocols.